Increased spending by the government and the upcoming festival season would boost demand, said Rajnish Kumar.

State Bank of India (SBI) Chairman Rajnish Kumar on Sunday said credit demand remains subdued and there is a need for stimulus in the economy. Though lack of credit demand exists in the economy, there is no supply-side constraint as the public sector banks are more or less well-capitalised, he said. "Demand for credit in the economy is subdued. There is a need for stimulus in the economy", Mr Kumar told reporters here. He was in the city to attend the multi-level consultation programme with the branch managers of SBI in the region.

"There is no supply-side constraint. More or less, the public sector banks are well capitalised and bank rates also moderated," he said. Mr Kumar hoped that monsoon will have a positive impact.

Increased spending by the government and the upcoming festival season would boost demand, Mr Kumar added.